Case Metso: Creation of a new common SAP platform to support growth strategy

Following the merger of Metso and Outotec in July 2020, the leading minerals processing equipment and aftermarket company had extensive and varied SAP systems in place for its global operations, with customised processes for its businesses. Rather than integrate into one existing system Deloitte was invited to deliver an ERP Roadmap project to help Metso define the scope of the future solution that would not only tackle integration but enable the company to build a future-proof platform. Metso requested a phased approach in how to get to the new common harmonised solution, and support in business case creation for decision making.

Following this work, Deloitte continued as the client’s business transformation partner to tackle the challenge of two separate legacy SAP ECC systems: overlapping ways of working, a high total cost of ownership and technical debt, lack of consolidated financial reporting, a high level of customisation, manual processes and missed revenue generation opportunities. Additionally, the existing system landscape was not easily adaptable to support Metso’s M&A activities and future growth agenda.

We wanted to have a business transformation partner who has the skills and industry experience to enable us to build a strong yet agile platform. Deloitte brought that to the table combined with understanding of our history, current situation and future goals. Adding excellent insights into problem solving when unavoidable issues occur has made Deloitte a great partner for us on the journey.

Eeva Sipilä, CFO, Metso

Guiding principles to ensure the right direction from the start

Metso set up a business transformation programme to tackle the challenge, with the main objective of consolidating the system landscape to improve the ability to serve clients and capitalise on future opportunities in each business area. More standardised and harmonised processes, flexible architecture and new ways of working were sought to achieve efficiency gains, high quality master data, greater operating agility and more. The programme also leveraged automation and wider end-to-end integration of tax to achieve significant tax benefits of streamlined business model and to ensure current and future compliance with evolving legal mandates on e.g. real-time reporting.

The Metso and Deloitte teams established key principles prior to implementing the programme. These included a drive for significant concrete business-validated benefits; building a unified, simplified and scalable ERP solution with flexible solution architecture that supports Metso’s journey as an industry leading company; and harmonising E2E processes and master data. To achieve the key principles several levers were used. The programme used a greenfield approach supported by Deloitte best practices and pre-configured SAP solutions as well as process mining to accelerate the programme and enable harmonisation.

More than 100 value cases were tracked throughout the programme by establishing a business case with benefit KPIs, paying attention to strategic differentiators and value levers, and focusing on change management to ensure adoption of the new system and processes. The programme organisation was built from the start so that Metso and Deloitte were jointly responsible for the programme governance, with clear definition of roles from work streams to the steering group.

Our long-term collaboration with Deloitte, their SAP S/4HANA and business experience combined with the dedicated Metso team have helped us to jointly build phased program, that helps us navigate through this complex transformation successfully, provide flexibility for surrounding changes and have tight control on risk mitigation. We have truly worked together as one team to achieve our common goals.

Vesa Erolainen, CIO, Metso

Outcomes for the successful implementation

The programme has achieved significant outcomes through its first two phases so far. In Phase 1, the programme followed Finance first principle, with the successful go-live of a global Central Finance solution for all legal entities for the group after 13 months, which provided the base for a new group finance solution enabling Group reporting and planning from one S/4 HANA system. Additionally, a month later a global template pilot was deployed to two companies in Canada and Finland, with validation of the template completed. Programme Phase 2 further deployed the template and selected additional capabilities to 11 new countries in 10 months. Phases 3 and 4 are ongoing as parallel programme streams.

Jointly defined Programme KPIs and Business KPIs have been validated, and continuous follow-up was initiated to ensure that the programme's objectives were met.

This programme is a perfect opportunity to develop and implement a new standardised yet flexible and expandable future business platform. It has been a pleasure to work together with Deloitte’s industry, SAP S/4HANA and integrated systems experts to streamline the architecture and end-to-end solution while simultaneously leveraging the landscape’s technical performance to support our future needs. The phased deployment has enabled splitting complexity into steps and smoothen the transformation.

Simo Puumalainen, Head of Programme, Metso

Keys to success

The programme's success was made possible by several actions taken before and during the implementation, such as:

• Agree on guiding principles prior to the programme start to ensure right direction.
• Invest in the growth of the transformation organisation's maturity prior to the start of the implementation.
• Ensure suitable business representation in the programme steering committee and business stakeholder support throughout the transformation. Include the business and embed change management from the start.
• Seek leadership alignment and support for “why not” approach to keep the ERP core clean and to meet the ambitious timeline.
• Focus on educating the programme team on methodology, tools and ways of working during the preparation phase. Employ strict programme governance and risk & dependency management, with a results management component throughout the programme.
• Create one integrated team with a true partnership.
• Leverage global delivery centers effectively to access broad expertise base, enable team scalability, bring in industry specialization and achieve cost efficiency.
• Pay special attention to areas where the legal requirements are forcing more automated end-to-end solutions, e.g., digitalisation of taxes, in order to ensure appropriate benefits in these areas.

It is remarkably visible how dedicated Metso is to ensure success in the transformation throughout the organisation. Top management is actively involved in the programme to ensure that the right decisions are made at the right time. Business stakeholders closely follow the programme, raise topics as needed and organise resources appropriately. The programme team embraces open communication and collaboration and is focused on the outcomes. This kind of admirable dedication has enabled us to execute jointly an ambitious timeline to pursue the targeted benefits.

Janne Parkkonen, Partner, Deloitte